The Gas Blockade and Tokyo’s Choice
Japan is evaluating the removal of the 50% usage limit for coal-fired power plants, a measure that could reduce liquefied natural gas (LNG) consumption by half a million tonnes annually. The initiative, announced by the Ministry of Economy, is linked to a supply crisis that has impacted LNG flows from the Middle East. The country imports approximately 4 million tonnes of liquefied natural gas annually from that region, with strategic importance for the national energy balance. The current tension has made gas a scarce commodity, with prices rising and flows interrupted.
As a result, Tokyo’s decision is not a simple adjustment of energy policy, but an operational response to an infrastructure collapse. The crisis was triggered by the de facto blockade of the Strait of Hormuz, which has made it impractical for LNG-laden ships to transit. This has forced the government to reconsider the use of more polluting sources, despite the national commitment to reduce emissions. The figure of 4 million tonnes of LNG imported annually from the Middle East is not an arbitrary number: it represents the critical volume that, if interrupted, threatens the stability of Japan’s power grid.
The Liquefied Natural Gas Supply Chain and the Hormuz Bottleneck
The flow of liquefied natural gas from the Middle East to Japan follows a well-defined route: starting from export terminals in Saudi Arabia, Qatar, and the United Arab Emirates, ships cross the Strait of Hormuz, then the Arabian Sea and the South China Sea, before reaching Japanese liquefaction terminals. This route has been interrupted by coordinated attacks on energy infrastructure, with approximately 40 assets hit in the Persian Gulf. The blockade is not total, but sufficient to create a critical bottleneck. The capacity of the Strait of Hormuz is about 20 million barrels per day, but its partial closure has reduced available flow to less than half.
LNG carriers are designed to operate under high safety conditions and with rapid response times. However, rerouting requires repair and reconfiguration times. Alternatives, such as passage through the Cape of Good Hope, increase travel time by about 15 days and transportation costs by over 30%. Additionally, Japanese liquefaction terminals are designed to receive LNG from specific routes, with limited storage capacity. The repair time for a damaged facility is estimated at 60-90 days, a period too long to address an immediate crisis.
Who Pays and Who Benefits in the New Energy Equilibrium
Japanese energy companies operating coal-fired power plants see an increase in marginality, as coal is currently cheaper than liquefied natural gas. Companies like JERA and Chubu Electric have already begun planning production increases, with an estimated revenue increase of 1.2 billion dollars for the fiscal year 2026. Conversely, LNG producers like Shell and ExxonMobil are experiencing reduced demand, with deferred term contracts and a 18% price drop compared to the previous month.
The port of Yokohama, the country’s main liquefaction terminal, recorded a 40% decline in LNG ship traffic in the first 10 days of April. This negatively impacted local logistics services, with increased maneuvering and storage costs. Coastal cities dependent on LNG transportation, such as Osaka and Nagoya, are facing rising energy costs, with a direct impact on industrial consumers. Conversely, regions with coal-fired power plants, such as Hokkaido and Kyushu, are seeing improved operational profitability.
Closing: The New Energy Normality
Japan’s decision to reactivate coal is not an isolated event, but a signal of a forced transition. The global energy system is now more vulnerable to infrastructure bottlenecks than to economic factors. The next step will be verifying the storage capacity of liquefaction terminals and the repair time for damaged infrastructure. Monitoring Yokohama port traffic and Singapore’s LNG prices will be crucial to assess whether the crisis will resolve or transform into a new normality. The tension between security and sustainability is no longer a political issue, but an operational constraint defining the future of global energy consumption.
Photo by Quinten de Graaf on Unsplash
The texts are autonomously generated by AI models